Openreach Hints at SOGEA UK Standalone FTTC Broadband Prices

Openreach has published a short notice to give a very rough indication of how much their new ‘Single Order Generic Ethernet Access’ product might cost ISPs at wholesale. At launch in 2019 the service will enable consumers to buy a standalone FTTC “fibre broadband” (VDSL2 or G.fast) line without the voice (phone) service.

Previously consumers had to buy their phone service alongside line rental (included by default) and then FTTC broadband was optionally added on top. Today few people use their landline for making calls and thus SOGEA reverses the aforementioned approach, making it possible to buy a copper line just for broadband. Consumers will still be able to add a voice feature if they want, albeit more as an optional VoIP add-on.

This is a radical shift for the operator and ISPs, which has required a lot of internal changes to be made. In the past some have made the mistake of assuming that this would make such broadband-only connections much cheaper vs broadband + phone bundles, but in reality you still need the copper line rental for broadband and only a tiny amount of the delivery cost sits with the voice (phone) service that goes over the top.

As it stands we’re still waiting for some solid SOGEA / SOGFAST pricing details but today Openreach has at least confirmed their indicative approach to wholesale pricing, which as expected is essentially just a merge of the existing copper line rental costs with the broadband side (not much change for consumers). The operator uses fully unbundled (LLU MPF) line pricing below as their basis.

Openreach Statement

As SOGEA is a new product without a mature cost stack, we will use MPF + FTTC as the starting point for Pilot Phase pricing. This is consistent with discussion in the recent Wholesale Local Access final statement. The pricing guidance below is intended to give our CPs an indication of our SOGEA Pilot phase pricing plans at this point in time. Given this is a new product currently in trial, we will provide more formal pricing details closer to Pilot as we are still informing our view of costs.

The SOGEA Pilot Phase pricing principles are expected to be as follows:

• SOGEA rental pricing will be the sum of MPF rental pricing + FTTC rental pricing of the relevant tier

• SOGEA connection pricing of a premise currently served by an Openreach line will be aligned to MPF connection products re-using existing Left-In-Jumpers (currently priced at £11.24) + FTTC connection pricing

• Guidance on SOGEA connection pricing of an unserved premise (i.e. a “new provide”) will be provided at a later date

A formal pricing notification for the Pilot Phase pricing with associated changes to the Openreach Price List will be notified in due course and at least a minimum of 28-days’ notice before Pilot start date.

All of this will of course support Openreach’s gradual move to phase out the old analogue Public Switched Telephone Network (PSTN) and replace it with new digital, internet based (all IP) services by 2025, which is something that is being separately consulted upon (here).